Digital Hones Brands' Value-Added Services

Known for its athletic gear and omnipresent swoosh, Nike also has significant traction with its famed Nike+ community. Nike+ is a line of services and products that socializes and gamifies fitness activities. By using a series of free apps for Android and iOS devices and purchasable products, like the FuelBand activity tracker, participants can record activities, track their progress, and compare results with other members of the Nike+ community.

The value for Nike, of course, is that these noncore but valued services drive brand loyalty and recognition.

“Growing a business can't be about buy, buy, buy,” says Jeanne Bliss, a customer experience expert and the founder of the consultancy CustomerBliss. “It has to be value added, and you have to earn the right to [customers'] trust and a relationship.”

This concept isn't new, but the proliferation of mobility allows companies to offer a vaster array of services—using customer insights to determine and power the features that are most important.

Procter & Gamble's toilet paper brand, Charmin, initially sponsored then purchased the SitOrSquat app, which shows the location of public restrooms across the United States. After acquiring the rights in 2010, Charmin cleaned up the interface, simplified the rating system, and developed a Spanish-language version. It currently has 125,000 public restrooms in its database, based on user-generated submissions.

Good, better, best

“We see the app more as a way to create meaningful consumer engagement rather than as a sales tool,” says Laura Dressman, Charmin's communications manager. “Digital technologies allow us to engage with more consumers to better meet their needs anytime, anywhere.”

Nike spokesperson Megan Saalfeld also sees this transformation: “[A]s the power of these new technologies continues to accelerate, the potential to deliver better products and services continues to grow.”

Nike+ launched in 2006, initially as a service for runners (it now has dedicated services for basketball players and trainers), and according to the company website currently has 7 million members. In 2010 Nike unveiled its iOS app that allowed users to track runs; in June 2012 it revamped the app, enhancing the core features and expanding its availability to Android phones.

Essential to providing these services, Bliss says, is understanding customer behavior and interests. “You need to trawl through Web comments and complaints, and aggregate them into trends,” she says. “The companies that are leading edge [are the ones whose internal teams] agree on the categorization of issues and create consistency in the data management between those issues.” This latter condition is particularly important—if a company's departments disagree on what defines a customer trend, it's difficult to provide a consistent and valuable service to customers and prospective customers.

In the case of Nike, it was a simple and widespread trend that catalyzed the development of Nike+. “We knew that runners logged their runs,” Saalfeld says. “That was the insight. We used digital technology to redefine the idea of the basic logbook to create a powerful experience to help motivate runners.”

Charmin judges its app's success based on customer and media response. “For instance, Parenting magazine named SitOrSquat one of its best apps for moms in its December/January 2012 issue, and the app received attention in the D.C. metro area as a must-have mobile tool for those attending the Inauguration in January, as a shortage of Porta Potties loomed,” Dressman says.

But the easy availability of customer data—much of it unstructured—can create unexpected issues for businesses hoping to learn about what customers actually want. “If you listen too fast, you have squeaky wheel-itis,” Bliss says. This can result in companies fixating on a trend that isn't actually a trend, or trying to develop services around multiple issues when they should pick one instead.